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State Sees 8% Slide in Exports in Quarter

Slumping demand for high-tech equipment leads to a decline in shipments year to date as well. Other key sectors record sharp falloffs.

November 20, 2002|Marla Dickerson | Times Staff Writer

California's exports slid more than 8% in the third quarter, led by continued steep declines in shipments of technology equipment, according to trade statistics released Tuesday.

For the three months ended in September, California exports totaled $22.9 billion, down from $25 billion in the same period a year earlier.

Government trade statistics compiled by the Massachusetts Institute for Social and Economic Research showed that the year-to-date decline is even worse. Through the first nine months of the year, California's exports plunged 16.2%, compared with a 7.3% drop for the United States as a whole.

The major culprit is the slump in demand for high-technology goods, which account for nearly half of California's exports. The Golden State shipped $30.2 billion in computers and electronic products in the first nine months of the year, a 22.6% slide compared with the first three quarters of 2001.

Two other sectors -- machinery and transportation equipment -- that make up California's Big Three export industries got hammered as well. Through the first nine months of the year, exports of machinery were off 17.4% to $7.1 billion. The transportation sector, which includes commercial aircraft, tumbled 22.3% to $5.1 billion.

Daniel Wilson, an economist with the Federal Reserve Bank of San Francisco, said the decline in California's technology exports reflected a variety of factors, including a relatively strong dollar that makes U.S. goods expensive overseas; work disruptions at West Coast ports; a sluggish global economy that has weakened demand for high-tech products; and the continued shifting of U.S. manufacturing operations offshore, particularly to Asia.

"The recession pushed companies to look harder at their cost-cutting options, and a big one is outsourcing," Wilson said, noting that many of the resulting job losses "are permanent."

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